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Late in 2017, the National Association of Insurance Commissioners (NAIC) adopted changes to its Life and Health Guaranty Association Model Act which were designed to address
concerns arising from insolvencies of insurers writing long-term care insurance (LTCI). Prior to that revision, health insurers were responsible for the majority of guaranty fund assessments because LTCI was categorized as “health” insurance even though life insurers wrote most LTCI policies.  The revisions in the model act broadened the assessment base for LTCI insolvencies to include both life and health insurers and split the assessment 50%/50% between them, plus it provided for including HMO’s as members of the life and health insurance guaranty associations.

The Kentucky General Assembly adopted these changes in the 2019 legislative session in HB 382 sponsored by Rep. Joe Fischer (R -Ft. Thomas). The bill was supported by IIK members, and it was endorsed by the American Council of Life Insurers, as well as by major life and health insurers which do business in Kentucky. The bill passed unanimously in both the House and the Senate.

Please see here for a briefing paper prepared by the NAIC explaining the Model Act and its revisions.